Aquiline announces majority investment in LenderLive

4 drivers of growth in mortgage lending

Aquiline Capital Partners, a New York-based private equity firm investing in financial services, has agreed to become the majority investor in LenderLive Network, giving the company the financial support and expertise it needs to continue to grow in the upcoming year.

LenderLive is a Denver-based, end-to-end mortgage services provider offering outsource services, correspondent lending, loan servicing, document services, settlement services and due diligence.

“We have grown substantially — four or five fold — over the past six years, and diversified our businesses, so we came to the conclusion that it was an opportune time to find a new investor that would enable us to continue to grow the company,” Rick Seehausen, CEO of LenderLive, said in an exclusive interview with HousingWire. “A financial sponsor like Aquiline Capital Partners makes for an ideal partner to accelerate our growth even further.”

The new investor brings not only a tremendous amount of expertise on the financial side, Seehausen explained, but also gives LenderLive the financial support it needs for its various business divisions.

Seehausen said the company’s growth plan for the future includes acquisition and organic growth, and highlighted these four drivers of growth:

1. Document compliance

Document compliance on both the lending and servicing side is getting more intense. The bar is continuing to rise and GuardianDocs continues to see increasing demand.

2. More ways to please clients

Financial institutions know that they have to offer mortgages, as a product, but they’re increasingly looking at the cost and compliance risk of being in the mortgage business. Our fulfillment division gives them new options.

3. Capitalize on rising costs

The cost of servicing in-house continues to go up. For the economics to make sense, you need to do it on a tremendous scale or it becomes burdensome on the financial side. More and more institutions that were accustomed to serving in-house are turning to subservicers.

4. Do more due diligence

The other thing we are excited about is our due diligence business. Right now, the private secondary market is still relatively small, but we see signs that the private secondary market is beginning to reemerge. For that to happen, the loans will have to be reviewed by an independent third-party due diligence firm. If Fannie Mae and Freddie Mac’s roles get downsized, it can only occur if there is a private secondary market. Even if the GSEs continue to remain strong in the industry, I would still except that the private secondary market would return to the market. Even just the non-conforming and the jumbo products are governed by caps on their loan amounts and need financing for the market. As a due diligence provider, we work for several clients who securitize jumbo loan product. We see it potentially growing.

The transaction, the terms of which were not disclosed, is subject to customary closing conditions.

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